Yarra Valley Water (YVW) has developed a Nitrogen Cap for the company’s operations which relates to the total annual load of nitrogen discharged to Port Phillip Bay (the bay) via the waters of the Yarra River Catchment. The cap has been set at 87 tonnes of nitrogen discharged to the bay per year. The aim of the cap’s implementation is to ensure that YVW is operating within the carrying capacity of nature with respect to the nitrogen processing capacity of the bay. The creation of the cap has encouraged YVW to commence work with the Environment Protection Authority of Victoria (EPA) and other water industry stakeholders in the pursuit of innovative environmental management mechanisms to ensure nitrogen loads to the bay are managed in the most economic manner.